Poland: Communist state where the rich get richer while the poor, caught in the spiral of inflation, get poorer and poorer

May 17, 1983

Warsaw

Karl Marx, who set out to show that under capitalism the rich get richer and the poor, poorer, would be dismayed to see Communist-ruled Poland today. Yet, it is more or less officially acknowledged here that the economic crisis hits hardest at the poor. And so do the reforms designed to resolve the crisis.

The rich, meanwhile, are rapidly getting richer.

They are not capitalists in the classic sense. Rather they are resourceful entrepreneurs who know how to cut legal corners and turn inflation to their benefit.

They exploit aspects of the economic reform that, at this early stage, lend themselves to the turning of quick and substantial profits.

Ordinary Poles find this hard to take. Most are far removed from even a modest touch of affluence, let alone luxury.

These people spend at least half their earnings on food. Children's clothes and other day-to-day expenses take the rest. The ''free'' and black markets, where goods are generally of better quality, are beyond their reach.

Basic food prices have more than quadrupled in recent years, even as the value of the zloty has been falling. The effect is the negation of the supposed gains of pay hikes and other compensation.

At least 27 percent of workers and other employees in the so-called ''socialized'' sector must get along on less than 5,000 zlotys a month (about $ 60 at the official exchange rate) - less than half the national average wage. Some 34 percent of pensioners do the same. Some make do on even less.

The government says there will be no more food-price increases this year. But it knows they are bound to come later.

It is widely accepted now that one of the fatal errors of the generally euphoric 1970s was the freezing of prices at unrealistically low levels. This led to conflict between the private farmers and the authorities - and the breakdown of the market.

Poland ended 1982 with a budget deficit equivalent to some $2.8 billion.

Four times since 1956 the regime has been rocked by workers' revolts over escalating prices.

Edward Gierek bought time in the '70s, but foreign debts piled up and the domestic imbalance finally spelled catastrophe.

To make the current reform work, if it is to work, economists insist that consumption must be cut and excessive consumer demand held back. In an effort to make this palatable, the government adds compensation bonuses to basic pay. It also pays three and four times the average monthly wage to workers in key sectors such as the mines.

But all this fuels inflation and leaves the spiral of wages and prices untouched: Last year personal incomes rose more than 60 percent. Enterprises boosted employees' earnings some 50 percent. (The 1983 plan foresees a further 12 percent hike.) The cost of living has risen 102 percent since last year.

At the same time, the government accuses managements of sabotaging the reform's essential purposes and of meeting their own increased costs by charging more for their products and paying higher wages instead of cutting costs, promoting efficiency, and improving quality for competitive export markets.

A recent poll showed that Poland slipped from 16th place in world export to 33rd between 1972 and 1982. It probably ranks even lower now.

Its position within Comecon, the East-bloc trading community, is no more rosy. A recent report showed that in 1978 labor productivity in this largest East European state ranked with that of the Soviet Union, Hungary, and Bulgaria.

But those three have left Poland far behind. It now has one of the two least labor-intensive economies in the area.

Last year, Poland's per capita output was the equivalent of only $3,500 to $3 ,800, compared with East Germany's $9,000 and Bulgaria's $6,000.

Poland's Comecon debts amount to some 4 billion transferable rubles, most of them owed the Soviets. These debts are bound to grow: Isolation from Western outlets leaves Poland dependent on Comecon markets.

Meanwhile, government leaders appeal for ''changed social attitudes and behavior'' and harder work from all segments of society. Nevertheless, the recent congress of the new ''national revival'' movement stirred little interest among ordinary Poles. Many said it is ''new'' in name only.

It is being said that - assuming calm during and after Pope John Paul II's scheduled June visit - the national day, July 22, could bring the final lifting of martial law and a start on amnesty.

But even strong supporters of Gen. Wojciech Jaruzelski admit in private that the keen public memory of Solidarity will remain, probably restraining popular response in the factories and elsewhere.

Repeatedly, the party press and hard-liners accuse the West of a fixation with ''an ordinary Polish citizen'' named Lech Walesa. Yet they do as much as anyone in the West to keep his name alive here by using so much space to denigrate him.